Energy stability. It’s a challenging conversation at the best of times with the complexities of climate change and the limitations of investment, but in Africa, it’s a conversation that has significant weight and many layers.
In South Africa, for example, the beleaguered national energy provider continues to battle with its balancing act of provision against investment and ageing infrastructure. Loadshedding has become the norm and has played no small role in the economic slowdown.
In early March, South Africa moved into another recession, the second in two years, with a 1.4% decline in the fourth quarter. The data released by Stats SA points to how the embattled power utility remains a key threat to the economy.
It’s a complex outlook that has put South Africa onto a challenging path but perhaps it’s time to look beyond the problems and towards a new interpretation.
The issue is, however, not limited to South Africa, with the Africa Energy Outlook 2019 published by the IEA citing that access to reliable, modern, affordable and sustainable energy remains a challenge for the continent. While the 2020s has brought more than its fair share of challenges, it is the opportunity to invest in energy security solutions that will allow for the country to stabilise its foundations and support its economy.
Green and clean for a sustainable future
Technology and innovation have changed the energy landscape significantly. There are sustainable energy solutions more easily available, allowing for organisations to invest in energy that does more than just turn on the lights. Reliable and clean energy sources haven’t been easily accessible in the past and many industries have struggled to integrate clean energy into their operations.
This has seen a rise in hybrid energy solutions that blend both solar and thermal with batteries to provide reliable energy supplies to companies that need always-on power. This steady evolution of accessible and sustainable energy solutions is now making its mark on the economy.
In a recent study into whether or not energy security is a driver of economic growth, researchers found that energy security measures did have a positive impact. They also found the reverse to be true – energy insecurity has a negative effect on economic growth. Using global samples from 74 countries, the analysts assessed energy security against the benchmarks of accessibility, availability, acceptability, affordability, and developability.
Each of these benchmarks fundamentally influenced the categorisation of energy provision within a country and how this energy provision influenced economic growth.
The final analysis underscored the value of energy security and sustainable energy investment to drive positive economic growth. It also highlighted the very real threat posed by energy insecurity and poor investment into renewable or sustainable energy solutions.
The business benefit of energy security
Aggreko recently signed a contract with Resolute at the Syama gold mining complex in southern Mali. The goal was to reduce carbon emissions and improve the overall site efficiency.
Aggreko will be operating and maintaining a 40MW thermal plant at a 10MW battery storage system with 20MW of solar power planned for 2023. This hybrid solution is set to reduce the mining complex’s power costs by 40% with an anticipated carbon emission reduction of 20% when the renewable power sources kick in.
Aggreko works closely with organisations to develop solutions that not only resolve energy security challenges but provide them with reliable resources in times of economic complexities. Using data, insights and innovative technologies, Aggreko has worked with multiple organisations and industries to shore up their energy investments and provide them with vital stability.
According to the IEA, energy efficiency goes beyond just the macro economy. The micro economic benefits extend into savings due to reduced pressure on importing energy reserves or supplies; the cost is then knocked on to the customer (individual and company) which increases spending power and capacity; and savings that can translate into further improvements of existing infrastructure. To break the cycle of that’s currently plaguing the South African power utility there is a need to address energy security across multiple layers that each plays a role in supporting the economy.
This energy security is of immense benefit to the business beyond just infrastructure and bottom line, it has been described by the World Economic Forum as ‘The Oxygen of the Economy’. As South Africa and other countries across the continent continue to invest in their energy utilities it is also opening up channels for investment into sustainable solutions that will support government and industry. Things are changing, but businesses need to invest in energy that will provide them with reliable foundations that will support them indefinitely.